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TheStreet Open House

'Fast Money' Recap: Stressed by the Tests

NEW YORK (TheStreet) -- The S&P 500 closed at session lows. On CNBC's "Fast Money" TV show, the trading panel discussed the new results from the stress tests, including whether banks will be permitted to return cash to shareholders. 

Citigroup (C) was denied the ability to return cash as a result of the tests for the second time in three years. Tim Seymour, managing partner of Triogem Asset Management, said the bank has ongoing issues in Mexico but said the valuation is too compelling to not like the stock. 

He was also a buyer of Bank of America (BAC), which increased its quarterly dividend to 5 cents per share, from 1 cent. It also initiated at $4 billion share buyback plan. However, the bank agreed to pay $9.5 billion in settlements due to bad mortgages during the financial crisis. 

Karen Finerman, president of Metropolitan Capital Advisors, said Citigroup will "get it together." She is long the bank and likes its valuation. 

Guy Adami, managing director of, said investors could own shares of Citigroup with a stop-loss at $46. He said it's time to consider taking profits in U.S. Bancorp (USB)

Steve Grasso, director of institutional sales at Stuart Frankel, said Bank of America is a buy based on its capital distribution announcement. He admitted the stock could get pulled a little lower due to weakness in the rest of the sector, but suggested shares could climb to the low-$20 range over time. 

Dick Bove, vice president and bank analyst at Rafferty Capital, said the second round of stress test results are more important than the initial results from last week. He said Morgan Stanley (MS) and Bank of America are his top two picks.

Overall, he said, today's large banks are very well capitalized and should see a rise in loan volume and margins; margins will be helped by higher interest rates. 

Twitter (TWTR) fell 7%. Adami admitted he didn't think the stock would get this low but suggested investors could start a long position at current levels. 

Seymour said the stock is oversold, based on a technical indicator known as the Relative Strength Index (RSI). Grasso agreed that the stock could bounce, aided by a 37% short interest. 

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